Taxpayer Administrative Justice: Tax Court Cancels DGT Letter that “Delays” Administrative Process

The issuance of a letter from the Director General of Taxes (DJP) formally returning a taxpayer's request for the cancellation of a tax assessment letter (STP) deemed incorrect now has significant legal implications following Tax Court Decision Number PUT-003001. 99/2024/PP/M.XVA of 2025. This dispute centers on the fundamental question of the scope of the subject matter of the lawsuit in the Tax Court based on Article 23 paragraph (2) of Law Number 14 of 2002 concerning the Tax Court. PT JEI, as the Plaintiff, strongly opposed the administrative request return letter (Letter S-897/WPJ.07/2024), which it considered to be closing their access to the right to dispute resolution at the DGT level.

The core of the conflict underlying this dispute is the difference in interpretation of the Request Return Letter. The DGT (Defendant) argues that the letter is only a procedural action in the form of a formal notification regulated by the Minister of Finance Regulation (PMK), and not a final substantive decision. The DGT's formal argument is based on the assumption that an objection had been filed against the Tax Assessment Letter for Underpayment (SKPKB), which is considered to be related to the STP for which cancellation was requested. Thus, the DGT considered that the taxpayer's request violated formal requirements, referring to provisions prohibiting the submission of requests for cancellation of STPs related to SKPKBs that had been objected to, as stipulated in PMK Number 8/PMK.03/2013 (or similar).

Conversely, the Plaintiff argues that the refund letter, although procedural, has caused real legal consequences, namely the loss of the Taxpayer's right to have their request processed in accordance with Article 36 paragraph (1) letter b or letter c of the General Provisions and Tax Procedures Law (KUP Law). Chronologically, the taxpayer asserts that the basis for issuing the STP whose cancellation is requested (e.g., related to administrative sanctions) is not related to the correction underlying the SKPKB that was previously objected to. Therefore, the DGT's formal reason for rejecting the request on the grounds that an objection had been previously filed against the Tax Assessment Letter for Underpayment (SKPKB), which was considered to be related to the STP requested for cancellation, is deemed inappropriate, which is essentially the same as denying the taxpayer's rights.

The Panel of Judges reviewed the provisions of Article 23 paragraph (2) of the Tax Court Law, which allows for lawsuits against DGT decisions that are detrimental. The Panel is of the view that the DGT's decision, which resulted in the administrative request not being processed, has clearly deprived the taxpayer of their right to seek tax justice. Considering that the STP being challenged has a different basis from the previous dispute, the refund letter that closed this administrative channel is categorized as a detrimental Decision and is therefore a valid object of lawsuit. This ruling absolutely grants the Plaintiff's lawsuit. This Panel of Judges' decision expands the scope of legal protection for taxpayers, ensuring that administrative procedures cannot override the substance of taxpayers' rights to legal certainty.

A Comprehensive Analysis and the Tax Court Decision on This Dispute Are Available Here